Q: What is the typical bankruptcy process?
A: First, you should meet with your attorney so that he can gather
information sufficient to inform you of your options and under which kind of
bankruptcy to proceed, if needed. You would be asked to complete some paperwork
about your finances and provide certain documentation. Once I have the
information, I use that information to personally prepare your bankruptcy
petition for you to sign and which is filed with the Bankruptcy Court. After
filing, you must attend a "Meeting of Creditors," at which you must provide a
photo I.D. and Social Security card or W-2. At the Meeting, creditors may
appear to ask questions, but almost never do. At the meeting, the bankruptcy
Trustee is required to ask you questions to ensure that the bankruptcy paperwork
filed with the Court was accurate. After the meeting, the only thing you need
to do would be the second (debtor education) course, and attend any
reaffirmation hearings scheduled. About 8 weeks after the 341/Meeting of
Creditors, you should receive a notice in the mail from the Bankruptcy Court
indicating that your debts have been discharged. Keep that notice in a safe
place.
Q: Will I lose my home?
A: Probably not, if you are current on your mortgage payments. Illinois
provides for retention of up to $15,000 in equity in a residence; this is
increased to $30,000 for married persons jointly owning a residence. If you are behind
on your home payments, and intend to keep your home, chapter 13 bankruptcy might
be your best option. Discuss your options with an attorney.
Q: Will I lose my car?
A: Unlikely. Illinois allows a debtor in bankruptcy to keep $2,400 of
equity in a motor vehicle, and allows a debtor to claim up to $4,000 as
additionally protected from seizure. Since many people owe more on their
vehicles than what they are worth, there would be no equity interest in the
vehicles to protect anyways.
Q: Will a bankruptcy stop wage garnishments or assignments?
A: Yes. Once a bankruptcy case is filed, an "automatic stay" takes effect,
preventing any creditor from pursuing any collection efforts after that point,
including wage garnishments or assignments. (This may not be the case for child
support garnishments, however). Should a creditor continue to garnish or
collect, you should contact your attorney, who should promptly enforce the law
against the offending creditor -- which not all attorneys are willing to do.
Also, wage assignments -- such as those borrowers sign at finance companies --
can be stopped simply be revoking the wage assignments. Some bankruptcy firms
charge for this service, but I make this information available free to you.
Q: Will a bankruptcy stop a foreclosure lawsuit? Can I keep my home, even
if I am behind?
A: A chapter 7 bankruptcy will temporarily halt a foreclosure proceeding,
but cannot stop it. A chapter 13 bankruptcy will stop a foreclosure, by
proposing a bankruptcy plan to the court whereby you repay any arrearage over a
generous period of time. A chapter 13 bankruptcy can stop a foreclosure, and
even a foreclosure sale, as long as it is filed before the foreclosure sale
date. During the proposed payment plan, you are required to continue making
regular mortgage payments.
Q: My car was repossessed! How can I get it back?
A: Bankruptcy under chapter 13 could help. In Illinois, if a chapter 13
bankruptcy is filed within 21 days of the vehicle's sale date, the vehicle must
be returned to you. Any amounts you were behind on the payments would have to
be made up, although over a generous period of time.
Q: I owe much more for my car than it's worth. What can I do about it?
A: You have several options. If you want to give up the vehicle, and its
associated debt, you could discharge that debt in a chapter 7 bankruptcy. If
you want to keep the vehicle, and meet certain requirements, you could pay
today's fair market value for the vehicle in a chapter 13 plan over a period of
time at a reduced interest rate. Or, you could redeem the vehicle -- paying
today's fair value for the vehicle -- in a chapter 7, if you have the capability
to do so.
Q: I've been sued by a creditor and have a court appearance coming up. What
can I do?
A: If you file for bankruptcy, that filing would halt any further court
proceedings. However, you could also go to the court hearing and ask the court
for a "continuance," because you need time to find an attorney or to get your
bankruptcy on file. Typically, judges will allow 30-60 days of postponement.
If you do not go to the hearing, the judge likely will enter a judgment against
you -- which may have serious legal consequences. You should seek an attorney
well before your court hearing, if possible, and bring with you any paperwork
related to that court proceeding so that your attorney can advise you in an
informed manner.
Q: I owe a utility company a lot of money and have received a shut-off
notice. What can be done?
A: You could pay the amount the utility demands to maintain service. Or,
you could file for bankruptcy. The utility company would insist on a small
deposit -- usually a few hundred dollars -- but would not be able to turn off
your power or other service. Any amount previously owed to the utility would
likely be discharged in a bankruptcy.
Q: How long will bankruptcy appear on my credit report?
A: Generally, credit reporting agencies seem to report chapter 7
bankruptcies for 8-10 years, and chapter 13 bankruptcies for 7 years. However,
the fact of a bankruptcy on your report does not mean you will not be able to
regain a positive credit rating. Once your current debts are wiped out, lenders
know that you have more income available to repay future debts, and clients have
reported to me that they have obtained credit cards and car loans shortly after
filing for bankruptcy. Bankruptcy nowadays does not seem to have the same
stigma it may have once had.
Q: Will my name be published in the newspaper if I file for
bankruptcy?
A: I have never seen a client's name published in the newspaper
because they have filed for bankruptcy. The only bankruptcies I have seen in
the news are those belonging to influential business people or others involved in
scandals. While bankruptcy filings are public records, it takes time,
determination, and money to actually access those records.
Q: I am married. Can I file for bankruptcy by myself?
A: Yes. A husband or wife can file independently, even if married. If you
have medical debts incurred while you were married, you may want to file
jointly, as in Illinois, medical debts incurred while married are collectible
against either spouse. You should consult an attorney for your specific
situation.
Q: My partner and I have been civilly united in Illinois. Can we file a
bankruptcy together?
A: Yes, you certainly can. I have filed bankruptcy for people in this
situation before with good results, and now that the Defense of Marriage Act has
been declared unconstitutional by the United States Supreme Court, there is no
barrier to you both filing bankruptcy together, if you wish.
Q: I have student loans -- can I file bankruptcy to get rid of student
loans?
A: Unfortunately, Congress has written the bankruptcy laws, and judges have
interpreted those laws, to make discharge of student loans extremely difficult.
However, this is not impossible. Generally, once must show the bankruptcy court
that repaying the student loans would present an undue hardship, that one has
made a good faith attempt to pay in the past, and that your dire financial
situation is likely to continue for a significant time. If you feel any of
these may apply to your situation, please consult with my office. Very, very
few attorneys handle these cases, but I do. Discharging a student loan involves
filing a separate lawsuit against the loan company in the bankruptcy court and
proving those elements that must be shown. The bankruptcy attorney handling
your student loan discharge case need not be the same attorney who actually
filed your original bankruptcy case. Contact me for further information.
Q: I owe the Internal Revenue Service (or the State of Illinois' Department
of Revenue). Can that kind of debt be discharged in bankruptcy?
A: It depends. If one has tax debt more than three years old, and tax
returns for the affected years were actually filed on time, then there is a good
chance the taxes could be discharged in bankruptcy. If not, the taxes could be
handled either through a chapter 13 bankruptcy, or through negotiations with the
I.R.S.
Q: I filed for bankruptcy, and a creditor has continued to contact me to
collect payments?
A: While some bankruptcy firms may not take this seriously, I do. Creditors
are not allowed to contact you at all to collect debts once you file for
bankruptcy. If this happens, contact me at once. Keep documentation of when
the creditor called, the phone number called from, and the person you spoke
with, or keep the mailing sent to you, or any other evidence of improper
contact. If the contact is improper enough, bankruptcy courts are allowed to
impose sanctions, including monetary damages, against these kinds of
creditors.
Q: I filed for bankruptcy, and a creditor has filed an adversary case
against me claiming that its debt should not be discharged. What can I do?
A: Seek an attorney immediately. Not all bankruptcy attorneys handle these
kinds of matters, but I have and do handle these issues. If you receive an
adversary case against you claiming that a debt should not be discharged, there
are relatively short deadlines that must be followed. Please seek an attorney
to discuss these issues with you as soon as possible in order to protect your
interests. The attorney handling any associated adversary case need not be the
same attorney as the attorney or firm who filed your bankruptcy case.
Q: I have multiple credit cards trying to collect, but I do not want to (or
can't) file for bankruptcy. What can I do?
A: I can negotiate settlements with the credit card companies for a reduced
price. They might insist on lump-sum payments of 25-50% of the total owed in
exchange for forgiveness of the remainder of the debts. Please call or email to
schedule a time to discuss these issues. Debts discharged in bankruptcy are not
taxable as income, but debts reduced and settled by lenders may be taxable as
income.
Q: My house is in foreclosure. What are my options?
A: You could file a chapter 13 bankruptcy, forcing the bank to accept the
behind-amount over a period of up to 5 years. Or, there are State law defenses
available to stall foreclosures, while you may remain in the home without paying
rent or the mortgage for a period of time. In addition, there are mortgage loan
modifications which could help prevent foreclosure or loss of your home. Please
contact me and we can discuss your current situation and find the best
options.
Q: What is a bankruptcy "mill?"
A: A bankruptcy mill is a term used for a large bankruptcy law firm with many
offices that files a lot of cases. These firms are notorious for charging
additional fees for every step in a case. These kinds of firms may advertise as
large "bankruptcy-only law firms" but actually handle non-bankruptcy matters
too. Bankruptcy mills are more like factories in that a client becomes little
more than a case number. Clients often may not receive the personal attention
that they deserve and paid for. Cases may often be primarily handled by
assistants or other non-attorneys with minimal involvement by actual attorneys.
It is often difficult for clients to contact the attorney of record on their
case at bankruptcy mills. Donald Knuckey Jr. Attorney at Law is not a bankruptcy mill.
I handle all my cases personally and all my clients are answered in a prompt and timely
manner by me, rather than an assistant. Here, your case will be handled by an attorney, start to finish.
You deserve competent representation, by an attorney, during your difficult time, and I am here to
help you.
A: First, you should meet with your attorney so that he can gather
information sufficient to inform you of your options and under which kind of
bankruptcy to proceed, if needed. You would be asked to complete some paperwork
about your finances and provide certain documentation. Once I have the
information, I use that information to personally prepare your bankruptcy
petition for you to sign and which is filed with the Bankruptcy Court. After
filing, you must attend a "Meeting of Creditors," at which you must provide a
photo I.D. and Social Security card or W-2. At the Meeting, creditors may
appear to ask questions, but almost never do. At the meeting, the bankruptcy
Trustee is required to ask you questions to ensure that the bankruptcy paperwork
filed with the Court was accurate. After the meeting, the only thing you need
to do would be the second (debtor education) course, and attend any
reaffirmation hearings scheduled. About 8 weeks after the 341/Meeting of
Creditors, you should receive a notice in the mail from the Bankruptcy Court
indicating that your debts have been discharged. Keep that notice in a safe
place.
Q: Will I lose my home?
A: Probably not, if you are current on your mortgage payments. Illinois
provides for retention of up to $15,000 in equity in a residence; this is
increased to $30,000 for married persons jointly owning a residence. If you are behind
on your home payments, and intend to keep your home, chapter 13 bankruptcy might
be your best option. Discuss your options with an attorney.
Q: Will I lose my car?
A: Unlikely. Illinois allows a debtor in bankruptcy to keep $2,400 of
equity in a motor vehicle, and allows a debtor to claim up to $4,000 as
additionally protected from seizure. Since many people owe more on their
vehicles than what they are worth, there would be no equity interest in the
vehicles to protect anyways.
Q: Will a bankruptcy stop wage garnishments or assignments?
A: Yes. Once a bankruptcy case is filed, an "automatic stay" takes effect,
preventing any creditor from pursuing any collection efforts after that point,
including wage garnishments or assignments. (This may not be the case for child
support garnishments, however). Should a creditor continue to garnish or
collect, you should contact your attorney, who should promptly enforce the law
against the offending creditor -- which not all attorneys are willing to do.
Also, wage assignments -- such as those borrowers sign at finance companies --
can be stopped simply be revoking the wage assignments. Some bankruptcy firms
charge for this service, but I make this information available free to you.
Q: Will a bankruptcy stop a foreclosure lawsuit? Can I keep my home, even
if I am behind?
A: A chapter 7 bankruptcy will temporarily halt a foreclosure proceeding,
but cannot stop it. A chapter 13 bankruptcy will stop a foreclosure, by
proposing a bankruptcy plan to the court whereby you repay any arrearage over a
generous period of time. A chapter 13 bankruptcy can stop a foreclosure, and
even a foreclosure sale, as long as it is filed before the foreclosure sale
date. During the proposed payment plan, you are required to continue making
regular mortgage payments.
Q: My car was repossessed! How can I get it back?
A: Bankruptcy under chapter 13 could help. In Illinois, if a chapter 13
bankruptcy is filed within 21 days of the vehicle's sale date, the vehicle must
be returned to you. Any amounts you were behind on the payments would have to
be made up, although over a generous period of time.
Q: I owe much more for my car than it's worth. What can I do about it?
A: You have several options. If you want to give up the vehicle, and its
associated debt, you could discharge that debt in a chapter 7 bankruptcy. If
you want to keep the vehicle, and meet certain requirements, you could pay
today's fair market value for the vehicle in a chapter 13 plan over a period of
time at a reduced interest rate. Or, you could redeem the vehicle -- paying
today's fair value for the vehicle -- in a chapter 7, if you have the capability
to do so.
Q: I've been sued by a creditor and have a court appearance coming up. What
can I do?
A: If you file for bankruptcy, that filing would halt any further court
proceedings. However, you could also go to the court hearing and ask the court
for a "continuance," because you need time to find an attorney or to get your
bankruptcy on file. Typically, judges will allow 30-60 days of postponement.
If you do not go to the hearing, the judge likely will enter a judgment against
you -- which may have serious legal consequences. You should seek an attorney
well before your court hearing, if possible, and bring with you any paperwork
related to that court proceeding so that your attorney can advise you in an
informed manner.
Q: I owe a utility company a lot of money and have received a shut-off
notice. What can be done?
A: You could pay the amount the utility demands to maintain service. Or,
you could file for bankruptcy. The utility company would insist on a small
deposit -- usually a few hundred dollars -- but would not be able to turn off
your power or other service. Any amount previously owed to the utility would
likely be discharged in a bankruptcy.
Q: How long will bankruptcy appear on my credit report?
A: Generally, credit reporting agencies seem to report chapter 7
bankruptcies for 8-10 years, and chapter 13 bankruptcies for 7 years. However,
the fact of a bankruptcy on your report does not mean you will not be able to
regain a positive credit rating. Once your current debts are wiped out, lenders
know that you have more income available to repay future debts, and clients have
reported to me that they have obtained credit cards and car loans shortly after
filing for bankruptcy. Bankruptcy nowadays does not seem to have the same
stigma it may have once had.
Q: Will my name be published in the newspaper if I file for
bankruptcy?
A: I have never seen a client's name published in the newspaper
because they have filed for bankruptcy. The only bankruptcies I have seen in
the news are those belonging to influential business people or others involved in
scandals. While bankruptcy filings are public records, it takes time,
determination, and money to actually access those records.
Q: I am married. Can I file for bankruptcy by myself?
A: Yes. A husband or wife can file independently, even if married. If you
have medical debts incurred while you were married, you may want to file
jointly, as in Illinois, medical debts incurred while married are collectible
against either spouse. You should consult an attorney for your specific
situation.
Q: My partner and I have been civilly united in Illinois. Can we file a
bankruptcy together?
A: Yes, you certainly can. I have filed bankruptcy for people in this
situation before with good results, and now that the Defense of Marriage Act has
been declared unconstitutional by the United States Supreme Court, there is no
barrier to you both filing bankruptcy together, if you wish.
Q: I have student loans -- can I file bankruptcy to get rid of student
loans?
A: Unfortunately, Congress has written the bankruptcy laws, and judges have
interpreted those laws, to make discharge of student loans extremely difficult.
However, this is not impossible. Generally, once must show the bankruptcy court
that repaying the student loans would present an undue hardship, that one has
made a good faith attempt to pay in the past, and that your dire financial
situation is likely to continue for a significant time. If you feel any of
these may apply to your situation, please consult with my office. Very, very
few attorneys handle these cases, but I do. Discharging a student loan involves
filing a separate lawsuit against the loan company in the bankruptcy court and
proving those elements that must be shown. The bankruptcy attorney handling
your student loan discharge case need not be the same attorney who actually
filed your original bankruptcy case. Contact me for further information.
Q: I owe the Internal Revenue Service (or the State of Illinois' Department
of Revenue). Can that kind of debt be discharged in bankruptcy?
A: It depends. If one has tax debt more than three years old, and tax
returns for the affected years were actually filed on time, then there is a good
chance the taxes could be discharged in bankruptcy. If not, the taxes could be
handled either through a chapter 13 bankruptcy, or through negotiations with the
I.R.S.
Q: I filed for bankruptcy, and a creditor has continued to contact me to
collect payments?
A: While some bankruptcy firms may not take this seriously, I do. Creditors
are not allowed to contact you at all to collect debts once you file for
bankruptcy. If this happens, contact me at once. Keep documentation of when
the creditor called, the phone number called from, and the person you spoke
with, or keep the mailing sent to you, or any other evidence of improper
contact. If the contact is improper enough, bankruptcy courts are allowed to
impose sanctions, including monetary damages, against these kinds of
creditors.
Q: I filed for bankruptcy, and a creditor has filed an adversary case
against me claiming that its debt should not be discharged. What can I do?
A: Seek an attorney immediately. Not all bankruptcy attorneys handle these
kinds of matters, but I have and do handle these issues. If you receive an
adversary case against you claiming that a debt should not be discharged, there
are relatively short deadlines that must be followed. Please seek an attorney
to discuss these issues with you as soon as possible in order to protect your
interests. The attorney handling any associated adversary case need not be the
same attorney as the attorney or firm who filed your bankruptcy case.
Q: I have multiple credit cards trying to collect, but I do not want to (or
can't) file for bankruptcy. What can I do?
A: I can negotiate settlements with the credit card companies for a reduced
price. They might insist on lump-sum payments of 25-50% of the total owed in
exchange for forgiveness of the remainder of the debts. Please call or email to
schedule a time to discuss these issues. Debts discharged in bankruptcy are not
taxable as income, but debts reduced and settled by lenders may be taxable as
income.
Q: My house is in foreclosure. What are my options?
A: You could file a chapter 13 bankruptcy, forcing the bank to accept the
behind-amount over a period of up to 5 years. Or, there are State law defenses
available to stall foreclosures, while you may remain in the home without paying
rent or the mortgage for a period of time. In addition, there are mortgage loan
modifications which could help prevent foreclosure or loss of your home. Please
contact me and we can discuss your current situation and find the best
options.
Q: What is a bankruptcy "mill?"
A: A bankruptcy mill is a term used for a large bankruptcy law firm with many
offices that files a lot of cases. These firms are notorious for charging
additional fees for every step in a case. These kinds of firms may advertise as
large "bankruptcy-only law firms" but actually handle non-bankruptcy matters
too. Bankruptcy mills are more like factories in that a client becomes little
more than a case number. Clients often may not receive the personal attention
that they deserve and paid for. Cases may often be primarily handled by
assistants or other non-attorneys with minimal involvement by actual attorneys.
It is often difficult for clients to contact the attorney of record on their
case at bankruptcy mills. Donald Knuckey Jr. Attorney at Law is not a bankruptcy mill.
I handle all my cases personally and all my clients are answered in a prompt and timely
manner by me, rather than an assistant. Here, your case will be handled by an attorney, start to finish.
You deserve competent representation, by an attorney, during your difficult time, and I am here to
help you.